Third-party funding for lawsuits makes juries more likely to rule in favor of the plaintiff.
Juries view the presence of outside investment as a signal that a legal claim has high objective merit. Many critics worry that outside money corrupts the court system or creates bias against individuals. The data indicates that knowing a professional investor risked capital on a case actually increases juror trust. This disclosure helps the legal system function by filtering for quality rather than just who has the deepest pockets. Plaintiffs with strong cases benefit from more than just money when they secure professional backing.
Measuring the Value of Litigation Finance
SSRN · 6726699
Litigation finance has become a focal point of contemporary debates about civil justice yet those debates remain largely theoretical and rest on untested empirical assumptions. This Article seeks to test these assumptions by fielding the first rigorous, large-scale empirical examination of how litigation finance shapes public perceptions of the civil justice system. Drawing on experimental survey data from over 2,500 U.S. citizens and over 7,000 data points, it employs a novel mock-jury design t